Part 1: Trademark Priority and Trademark Distinctiveness
US trademark law and the trademark registration process is very much different compared to trademark law in foreign countries. Whether a entrepreneur, inventor or US business is seeking to prosecute a federal trademark or a foreign entity or individual is contemplating filing a U.S. Federal Trademark Application, the following common mistakes in federal trademark registration may prove fatal and/or costly.
(1) Trademark Priority in the US
First of all, as Chicago trademark attorneys with many years of experience handling trademark matters, we can certainly attest to the fact that trademark law is one of the most complex areas of corporate practice. Trademark priority is oftentimes a misunderstood principle of trademark law. Trademark rights in the US are based on the first to actually, and continually, use the trademark in commerce, not the first to acquire registration of the trademark. Thus, registration of a trademark with the United States Patent and Trademark Office (USPTO) does not guarantee the registered trademark owner priority to use their mark in commerce against all others. In other words, being the first to register a federal trademark, does not necessarily give you the absolute right to use your trademark without the possibilty of infringing on another individual or businesses trademark (see trademark infringement). Under US common law (law established by the courts, rather than by statutes) the date on which a trademark is first used in commerce by the trademark owner determines who has priority to use that certain trademark. While common law trademark rights generally only extend to the geographic area in which the trademark is actually used, one benefit to federal registration is that a federally registered trademark is given a presumption of nationwide priority of use as of the date of filing the federal trademark application. This, in more instances than you can imagine, will create a complicated priority battle (litigation) between two trademark owners if both trademarks are either identical or confusingly similar.
Hypothetical: Joanne launches a professional counseling practice, providing online therapy sessions, and begins using her trademark as of January 1, 2014 in Charleston and Atlanta but never registers her trademark (she has a common law trademark). On January 1, 2015, Steve launches a similar professional counseling practice, with offices in Chicago and Milwaukee and the intent of establishing future in Charleston and Atlanta, using an almost identical name or trademark for his practice. Steve initiates the prosecution of a federal trademark application to protect his practice’s name and brand, which successfully registers. Steve, having thought that he has nationwide rights and trademark priority in his practice’s name, begins construction of his new offices in Charleston and Atlanta. Joanne find out about Steve’s new office openings and sues him for trademark infringement. Under this scenario, Joanne may ultimately win the lawsuit, prohibit Steve from using his trademark in Charleston and Atlanta, and possibly recover damages.
Now, suppose Steve, as soon as the doors are open to his offices in Chicago, Milwaukee, Charleston and Atlanta, initiates the prosecution of his federal trademark application on January 1, 2014, and it takes two years to successfully register the trademark (registration certificate will be issued January 1, 2016). During the registration process, Joanne decides to start using her nearly identical trademark, only in Charleston and Atlanta, on January 1, 2015. If Steve’s trademark is registered on January 1, 2016, his priority date becomes the date of FILING the application (January 1, 2014). Thus, Steve has nationwide priority of use over the trademark as of January 1, 2014, which is prior to Joanne’s use. Here, Steve may issue a cease and desist or file a trademark infringement complaint to prohibit Joanne’s use of her confusingly similar trademark.
These two scenarios can be confusing to many entrepreneurs and business owners. When dealing with a potential priority battle or when attempting to clear the availability of a trademark, both common law and federal statutes combine to form the basis of who will have the right to use a trademark, and how far those rights extend.
2) Trademark Distinctiveness
The extent to how far trademark rights extend will be partially determined on how distinctive a trademark is. Distinctiveness is determined on where the trademark falls in the trademark spectrum. From trademark that are not protectable to weak trademarks to strong trademarks, the spectrum is as follows: generic marks, descriptive marks, suggestive marks, and arbitrary/fanciful marks. Thus, one key question is always where the trademark appears on this trademark spectrum of distinctiveness.
Generic trademarks are never afforded protection. These are trademarks that identify the actual name or category of the goods and/or services. For example, Sk8Board for your product line of skateboards is a generic trademark.
Next are descriptive trademarks. These are trademarks that immediately identify a quality, character, function, or feature of the goods and/or services associated with the trademark. For example, Trademark Law Firm for an attorney providing trademark legal services. The term “Trademark Law Firm” actually describes a feature of the service; that a client will receive trademark legal services. Descriptive trademarks are generally not afforded trademark protection. Only if a descriptive trademark is able to obtain secondary meaning, then the trademark may register acquire certain trademark rights.
Suggestive trademarks are trademarks that suggest a quality, character, function, or feature of the trademark. Typically this involves some leap of imagination to connect the trademark to the goods and/or services. For example, Airbus for airplanes. Suggestive trademarks are instantly eligible for federal trademark registration.
Arbitrary and fanciful marks are the strongest trademarks on the spectrum of distinctiveness. Fanciful marks are made up words, or words that have no other meaning than acting as a trademark. For example, Google for a search engine. Arbitrary marks are terms that are not made up words, but the term has nothing to do with the goods and/or services. For example, Apple for computers, music players, and phones.
When a business, entrepreneur or inventor is seeking to launch a new business, brand or product, it is important to think about the spectrum of distinctiveness. Ensuring that a proposed business, brand or product name is instantly eligible for federal trademark registration can greatly reduce the costs and time it takes to obtain a federal trademark registration.
Our Chicago trademark attorneys will provide counsel to small businesses, corporations, and entrepreneurs in order to avoid such obstacles through federal trademark registration. If you have any questions or need help navigating the federal trademark registration process, contact our corporate law firm today!